Custom, Excise & Service Tax Tribunal
Cadila Pharmaceuticals Ltd vs C.C.E., Surat Ii on 19 January, 2018
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Zonal Bench, O-20, NMH Compound Ahmedabad Central Excise Appeal No.12628 of 2014-SM Arising out of the order-in-appeal No.SUR-EXCUS-002-APP-038-14-15 dated 27.6.2014 passed by the Commissioner (Appeals), Central Excise, Surat. Cadila Pharmaceuticals Ltd .. Appellants Vs. C.C.E., Surat II .. Respondent
Appearance:
Present Shri S.J. Vyas, Advocate, for the appellant Present Shri L. Patra, A.R. for the Respondent-Revenue Coram: Honble Dr. D.M. Misra, Member (Judicial) Date of hearing: 15.11.2017 Date of pronouncement:19.01.2018 Final Order No.A/10173/2018 Per Dr. D.M. Misra:
This Appeal is filed by the appellants against the order-in-appeal No. SUR-EXCUS-002-APP-038-14-15 dated 27.6.2014 passed by the Commissioner (Appeals), Central Excise, Surat.
2. Briefly stated the facts of the case are that the appellants had filed refund claim for Rs.7,77,702/- for the period 30.9.12 to 25.2.2013 on the ground that they have wrongly paid an amount of 6% of the value of the exempted goods cleared for export. The refund claim, on adjudication was rejected. Aggrieved by the said order, the Appellant filed Appeal before the ld. Commissioner (Appeals), who in turn, rejected their Appeal. Hence, the present Appeal.
3. The ld. Advocate, Shri S.J. Vyas for the Appellant has submitted that they are engaged in the manufacture of pharmaceutical products. They had manufactured and cleared Ethamutol HCL falling under Chapter Heading 29 of CETA, 1985 exempted from payment of duty by virtue of serial No.105 of Notification No.12/2012-CE., dated 17.3.2012. The said exempted goods manufactured by using common inputs on which credit availed were cleared both for home consumption as well as for export. At the time of clearance of the said Ethamotul HCL for home consumption, they had reversed 6% of the value of the said product and they had also reversed an amount of Rs.7,77,708/- as 6% of value while clearing the said Ethamutol HCL,against Excise Invoice No.830/2012 dated 30.9.2012, 1134/2012, dated 30.11.2012, 1584/2012 dated 21.2.2013 and 1607 dated 25.2.2013 for export. It is his contention that in view of Rule 6(6)(v) of C.C.R., 2004, they were not required to reverse the said amount. Accordingly, the present refund claim has been filed. It is his contention that eligibility to CENVAT credit on exempted goods exported under bond is no more res integra being covered by the judgments of the Honble Bombay High Court in the case of C.C.E., Aurangabad vs. Jolly Board Ltd. 2017 (50) STR 131 (Bom.); Abhishek Industries Ltd. 2016 (9) TMI 982 Punjab & Haryana High Court; C.C.E. vs. Drish Shoes Ltd. 2010 (254) ELT 417 (HP); UOI vs. Sharp Menthol India Ltd. 2011 (270) ELT 212 (Bom.).
4. Ld. A.R. for the Revenue reiterated the findings of the ld. Commissioner (Appeals).
5. I find that the issue is no more res integra and is covered by the various judgments of the High Courts and the Tribunal. In Sharp Menthol India Ltd.s case, the Honble Bombay High Court following the principles laid down in Repro India Ltd. v. UOI 2009 (235) ELT 614(Bom.), while analyzing the provisions in detail observed at Para 22 as follows:
22.?It is true that under Rule 6(1) of the 2004 Rules, credit of duty paid on inputs is not allowable when the inputs are used in the manufacture of exempted final products. But Rule 6(2) of 2004 Rules provide that where the inputs are used in the manufacture of exempted as well as dutiable final products, then credit of duty paid on inputs used in the manufacture of dutiable final products is allowable, provided separate accounts regarding the receipt, consumption and inventory of the input used in the manufacture of dutiable final product are maintained. However, Rule 6(6) of 2004 Rules provides that the provisions contained in Rule 6(1) to 6(4) of 2004 Rules shall not apply in certain specified cases, where the excisable goods are cleared without payment of duty. Clause (v) of Rule 6(6) of the 2004 Rules provides that where the exempted goods are cleared for export without payment of duty under Central Excise Rules, 2002, then the provisions contained in Rule 6(1) to 6(4) of 2004 Rules shall not apply. Thus, Rule 6(6) of 2004 Rules carves out an exception to the applicability of the provisions contained in Rule 6(1) to 6(4) in certain specified cases.
In view of the aforesaid ratio, the Appellant is not required to discharge 6% of the value of the exported Ethamotul HCL , which is exempted from duty. In my opinion, the impugned order is devoid of merit. Consequently, the same is set aside and the Appeal is allowed with consequential relief, if any, as per law.
(Pronounced in open Court on 19.01.2018) (Dr. D.M. Misra) Member (Judicial scd/ E/12628/2014-SM 1